The Biggest Mistake Freelancers Make
When starting out, most freelancers calculate their rate like an employee. They take their desired salary, say ₹12,00,000, and divide it by 2,080 hours (40 hours x 52 weeks). This gives an hourly rate of roughly ₹577.
This is a massive mistake. As a freelancer, you don't get paid for 40 hours a week. You have to spend time finding clients, doing taxes, sending proposals, and managing your business. These are non-billable hours. Most successful freelancers only bill 20 to 25 hours per week.
Factoring in Expenses and Time Off
Employees get paid time off, sick leave, and company-provided laptops. Freelancers pay for everything out of pocket. You must factor in:
- Vacation & Sick Days: Plan for at least 4 to 6 weeks of unpaid time off.
- Software Subscriptions: Adobe, Figma, Notion, Web Hosting.
- Hardware: Laptops, monitors, cameras.
- Taxes: As a business owner, you are responsible for your own taxes.
How to Use This Tool
1
Set Income Goal
Enter the amount of money you want to take home as your personal salary per year.
2
Add Business Expenses
Estimate your yearly costs for software, internet, equipment, accounting, and marketing.
3
Estimate Hours
Enter how many weeks you want to take off, and how many 'billable' hours you work per week.
4
Get Your Rate
The calculator will instantly show your minimum hourly and daily rates.